The purpose of this paper is to report on the results of a survey conducted in Ghana and
advances knowledge on determinants of contractors’ capital investment financing strategy.
The empirical investigation was conducted using survey
questionnaire. The dataset was obtained from 54 large construction firms operating in Ghana. The
consideration of overlapping aspects of the study largely motivated the use of factor analysis to
analyse the data which made it possible to make scientific deductions, descriptions and built
explanations from the results.
Findings – The study provides fresh contribution to knowledge and fills the empirical research gap
by deriving six new brands of uncorrelated variables that better explain contractors’ investment
financing decisions. These variables were manifested in the financial condition, macro-economic
indicators, bankruptcy cost, financial risk, transaction cost and financial policy. The paper
recommends future research to explore the relationship between these explanatory variables and
dependent variables, thus, equity and debt using regression models.
The original contribution and value of the paper is the orientation of the paper
between conceptual and empirical traditions and the contextual provision of realities contained in the
financial underpinnings examined and presentation of operations directions about the ways
construction executives can create action plans to improve their financial decisions through a deeper
understanding and application of the financial variables.

Description:

This Article was published by Journal of Financial Management of Property and Construction, (2009) Vol. 14 Iss: 1, pp.21 - 33